fellow-traveler, whom I introduce to the New York and Erie Railroad, it may be well to prefix here a brief sketch of the history and present condition of this, t

fastnesses of Rockland; his capacious maw fares sumptuously on the dairies of Orange and the game and cattle of Broome; his lumba

n to Dunkirk on Lake Erie. That this railroad, which after nearly twenty years of struggle and of financial vicissitudes had finally linked the Great Lakes with the Atlantic coast, was looked upon as a property of wonderful character and limitless futu

length from east to west, passing through countless towns and villages, over many rivers, through rugged mountain passes now, and anon amidst broad and fertile valleys and plains. In addition it has many branches, connecting its stations with other routes in all directions, and opening new stores of pictorial pleasures.... An interesting feature of this r

he appropriation was coupled with the condition that within two years the beneficiaries should have constructed a road wide enough for two carriages to pass, from Nyack on the Hudson River to Sterling Iron Works, a distance of about thirty miles; and that they should cut away the limbs of trees over th

survey apparently caused the project to be abandoned. But the idea still held sway over the minds of many people; and the great benefits brought to the Mohawk Valley and surrounding country by the Erie Canal led the southern counties to demand a transportation route w

declaimed the undertaking was "chimerical, impractical, and useless." The road, they declared, could never be built and, if built, would never be used; the southern counties were mountainous, sterile, and worthless, and afforded

vers. This catastrophe delayed further progress for years, and it was not until 1846 that sufficient new capital was raised to go on with the work. The original estimate of the cost for building the entire line of 485 miles had been three million dollars, but already the road had cost over six millions and only a small portion had been finished. The final estimate

or branches, giving the road an entry into Scranton, Pennsylvania, and into Geneva and Buffalo, New York. It had its terminus on La

company a speculative football in some of the most disreputable games of Wall Street stock-jobbers. For though the original estimate had been three millions and the highest estimate of the c

hippers held indignation meetings and again and again made appeals for legislative relief. Although much money had been raised after 1849 for improvements, the condi

way it obtained a more direct connection with New York City. It changed the tracks of its new railroads to the six-foot gage, which the Erie had adopted from the

driven cattle when a boy from his native town of Carmel in Putnam County to the New York City market and, for some years later, he had been proprietor of the Bull's Head Tavern. Shrewd, unscrupulous, illiterate, good-natured, and sometimes generous, he w

any time it might help his pocketbook to do so. He frequently advanced money which the road could not obtain elsewhere, always taking full security and excessive commissions. This practice gave him the name of "s

ity to achieve a real masterpiece in manipulation. The stock of the Erie road was then selling at about 95 and the company was in pressing need of funds. The treasurer came to the rescue as usual and made the necessary advances on adequate security. The co

is time our friend, Daniel Drew, was quietly selling Erie stock and closing contracts for the future delivery of the certificates; and he was doing this at rising prices. As the days went by, his grave, desponding manner grew more and more apparent. Erie stock continued to rise. In the loan

ye his $3,000,000 in Erie bonds was converted into Erie stock, which he proceeded to dump in Wall Street. Erie quotations

his time looming up in the railroad world, and Vanderbilt had his own theory of the management and financing of railroads. It was inevitable that he should clash with Drew. He was a few years older than Drew, and the two men, as we have seen, had much in common. Both were well on in life before they had transferred their activities to steam railroads. When finally, in 1868, they

nnual election of officers approached and liquidated shortly thereafter. Besides Vanderbilt there was another interest at this time trying for the control of the Erie. This interest consisted of certain Wall Street speculators and certain Boston capitalists who proclaimed themselves railroad reformers. These so-called reformers were as uns

ppeared to be in a position to oust the Drew interests without difficulty. On the Sunday preceding the election the Commodore saw Drew and amicably explained to him the trap he had laid, and showed him clearly that there was no way out of the situation. Upon this disclosure, Treasurer Drew at once

were puzzled and confused by this sudden change of front. Later, all parties met at Drew's house, and Vanderbilt brought the Boston men to terms by proposing a plan to Drew whereby they

e board, applied for an injunction against Treasurer Drew and his brother directors to restrain them from the repayment of the $3,500,000 borrowed by the railroad from Drew in 1866, and to restrain Drew from taking any legal steps toward compelling a settlement. J

eeds in the stock-market or at elections demanded, they had supplied themselves with new Erie stock by leasing the worthless road to the Erie and then exchanging Erie stock for the worthless stock of the leased line. The cost of the line to Drew and his friends, as financiers, was about $250,000. They then issued, as proprietors, $2,000,000 in bonds of the road, payable to one of themselves as trustee. This person then sh

also forbidding the Erie to guarantee any further issues of bonds. An additional injunction forbade Drew from having any transactions in Erie stock or fulfilling any cont

o work his own ruin. But notwithstanding the apparently desperate situation it was quite evident that Drew's nerves were not seriously affected. Although he seemed rushing on destruction, he continued day after day to put out mo

r less than par, but convertible bonds could be disposed of by the directors at any price. A secret meeting of the executive committee was held, at which it was voted to issue immediately and to offer for sale $10,000,000 in convertible bonds at 72 1/2. Drew's broker

new shares, now determined to bring up the reserves and let the eager buyers have the other five millions; but before the bonds could be converted the injunction had been serv

made his formal demand for the conversion of the bonds and was refused. All this was done upon affidavit, as it was the plan of Drew to get from some judge a writ of

the secretary to an employee who was directed to carry them from the office of the company in West Street to the transfer clerk in Pine Street. The messenger left, but in a moment or two returned to report to the apparently amazed secretary that Fisk had met

o the amazement of everybody, Judge Gilbert issued an injunction restraining all parties to all the other suits from further proceedings; in one paragraph ordering the Erie directors to continue in the discharge of their duties-in direct defiance of the injunction of one judg

had been flung on the market. Vanderbilt, who was ignorant of this situation, bought the new stock as eagerly as the old. Then, when the facts came

he Erie Railroad into their pockets, they made off under cover of darkness to Jersey City. One man carried with him in a hackney coach over $6,000,000 in greenbacks. Two of the directors lingered and were arrested; bu

ancial collapse. Drew had taken away about seven million dollars of his money and an artificial stringency had been created in Wall Street by this exodus

k and was immediately enjoined from acting by another judge. Then Peter B. Sweeney, of the Tammany ring, was appointed in his stead without notice to the other side. There was nothing for a rec

ergency. It was the intention of the Erie interests to do their real work with the Legislature at Albany. This was also the intention of the Vanderbilt interests. Consequently, during the subsequent session, the grafters in that body were wooed by both sides. When the Legislature convened, a bill was promptly introduced making legal the recent issue of Er

ed against him for contempt of court and was held in bail of half a million dollars for his appearance in New York a few days later. He appeared before Judge Barnard in New York and was put in the charge of a sheriff. But t

the fastest trains. Gould stayed in Albany until April, and by this time a remarkable change had come over the mentality of a majority of the legislators. On the 13th of April a bill was presented in the Senate which met the approval of the Erie interests and which Judge Barnard afterwards designated as a bill for legalizing counterfeit money. This bill, which was passed after due debate, legalized the i

he critical moment, Vanderbilt surrendered, made a secret deal with his foe, and withdrew his opposition to the bill. The anger of the disappointed grafters and vote-sellers knew no bounds, and the

nteed by the Erie, and received $1,000,000 in cash for an option given the Erie Railroad to purchase his remaining 50,000 shares at 70 within four months, besides about $430,000 to compensate his friends who had worked so heroically for him

,000,000 of Erie securities. Thus in all about $9,000,000 in cash or securities was drawn out of the Erie treasury in final settlement of this great stock market manipulation. And this do

Jay Gould to the receivership of the Erie in 1875 is a long and intricate tale. Suffice it to say that the events were generally similar to those already recounted-stock-market corners, over-issues of bonds and stocks, injunctions, court orders, arrests, legislative bribes. Less than a week after his electio

James Fisk, Jr., eliminated Daniel Drew and left him high and dry without a cent, through a new stock corner. About this time the road was financially on its last legs, and Jay Gould was appointed receiver. This started further litigation which dragged on for several years until, in 1874, Gould was turned out by General Daniel E. Sickles in combination with t

s of the courts. In April, 1878, a new company, the New York, Lake Erie and Western Railroad, took over

of the system westward should have increased its earning capacity. Up to this time the Erie had no Chicago connection and was at an obvious disadvantage compared with its competitors. It improved this situation in 1881 by acquiring the New York, Pennsylvania an

ailure in Wall Street in 1884 was a severe blow to the company's credit, as this firm was at that time doing important financing for the

nherent worth of the property that during the half dozen or more years following, the Erie succeeded in struggling along in the face of all its financial and other handicaps and at the same time showed substantial growth in the volume of it

eceivership, and an entirely new company, intelligently designed and having ample working capital for future development, was formed with E. B. Thomas at its head. This new president, like Daniel Willard of the Baltimore and Ohio and many of the modern railroad leaders, was a practical railroad man who had worked up from the ranks and who had no large financial interest or banking connections to divert his attention from the real business of management. Under Thomas, who remained at the head of affairs from 1896 to 1900, the Erie made substantial progress. The system was solidified and its territory was more uniformly and systematica

ager of great executive talent. Underwood's idea was to make the Erie a great freight-carrying system by developing its tonnage and its freight capacity in every way possible. Consequ

nsive mileage in the soft coal regions of Ohio and Indiana, and its soft coal tonnage today far overtops its tonnage of anthracite coal; its train load averages far higher than that of the New York Centr

Erie has had to create new mortgages and borrow many millions; but a large part of the expenditure for improvement has come directly from earnings. The Underwood administration has been conservative in paying dividends and the stockholders grumble. But the Erie is at last coming into its own. Instead of being a speculati